What would single-payer mean for Vt. businesses?

"We're about to take one the largest undertakings in the history of the United States," said Bob Gaydos, an insurance consultant. "Employers right now have been caught off guard."

Insurance expert Bob Gaydos is talking about Vermont's proposal to switch over to a single-payer health care system, called Green Mountain Care, by 2017. At this point in the process there are several unanswered questions and no one wants answers more than the employers themselves.

"Well, I think it's the fear of the unknown," said Lon Finkelstein of the Vermont Tent Company.

Finkelstein says under the current system his employees have a choice between two health insurance policies.

"We're in business. I always thought that competition ends up being the best thing for the consumer whether it's the rental business or health care," he said.

The state wants to take employers like Finkelstein out of the business of health care. Under Green Mountain Care his employees would be required to sign up for coverage through the state's insurance system, not through the company's human resources department. While some employers think it's a promising concept, many worry how the state will pay for it.

"On the financing we're being honest about it-- we need to spend more time," said Anya Rader Wallack, the special assistant to the governor for health reform.

What's clear is that funding will likely come from some form of a broad-based tax. The most talked about option is a 15 percent payroll tax that would be split between employers and employees.

"If the payroll deduction for employees is 3 to 5 percent, most employees would see their payroll deduction be a little bit lower than what employers are charging them," Gaydos said.

But tying universal coverage to a paycheck poses a potential problem. If an employee makes $100,000 and must pay 5 percent into the system, health care coverage would cost him $5,000 a year. But an employee earning $30,000 would pay $1,500 dollars for the same care. Experts worry that the unintended consequences of a single-payer system could drive high salary industries out of Vermont.

"If Vermont accidentally creates a business climate that does not attract high salary jobs, then by definition our tax base will lower. And if our tax base lowers, then it's a house of cards," Gaydos said.

"I don't think we'll want to design something that would drive out high salary industries. If we proposed a health care plan that did that we would be undoing our own good work," Rader Wallack said.

Another detail yet to be determined-- can Vermont force national employers not based in Vermont, like Walmart and IBM, to participate in a single-payer system?

"We cannot require a self-insured employer to participate in Green Mountain Care. We can require a self-insured employer to participate in a financing system for universal coverage," Rader Wallack said.

"There's no doubt that large national corporations who have businesses in Vermont are going to challenge Vermont," Gaydos said. "That's going to end up in court. There's no doubt that's going to end up in court."

So as the unanswered questions pile up, the clock ticks and employers are left looking for direction.

"Kinda in a wait and see mode, you know, talking to other business owners, trying to find out what information we can," Finkelstein said.

The current bill as it's written requires that a fiscal plan to be presented to the Legislature in two years. But that plan wouldn't kick in for four years after that. So the state says taxpayers will have plenty of time to react to the specifics before any tax is implemented.